Radar on Medicare Advantage

Given that states typically contract with just a handful of managed care organizations to serve their Medicaid enrollees, Medicaid managed care by nature has always been a competitive space. But with procurements picking up after the COVID-19 public health emergency derailed some states’ efforts last year plus an increased emphasis on health equity and social determinants of health (SDOH), MCOs have a lot to manage when it comes to competing for new Medicaid pacts.

During a presentation at the AHIP 2021 National Conference on Medicare, Medicaid & Dual Eligibles, held virtually from Sept. 21-24, two Medicaid managed care experts discussed some of the trends in Medicaid requests for proposals (RFPs) and ways MCOs can respond accordingly.

✦ CMS will bar several Medicare Advantage Prescription Drug (MA-PD) plans from enrolling new beneficiaries for 2022 because they did not meet minimum medical loss ratio (MLR) requirements. According to a series of notices posted to the CMS Enforcement Actions page, CMS issued enrollment suspensions to the following organizations: MMM Healthcare, LLC, Triple-S Advantage, Inc., UnitedHealthcare of Arkansas, Inc., UnitedHealthcare of the Midwest, Inc., and UnitedHealthcare of New Mexico, Inc. Because the plans failed to meet the 85% MLR threshold for their Part D contracts for three consecutive years, they will be removed from the list of MA-PD plans during the upcoming Annual Election Period, CMS said.

✦ CMS is seeking to repeal a Trump-era rule that would have given national Medicare coverage for four years to a “breakthrough” device as soon as it receives FDA approval. The agency on Sept. 13 issued a Notice of Proposed Rulemaking (NPRM) that proposes to fully repeal the Medicare Coverage of Innovative Technology (MCIT) and Definition of “Reasonable and Necessary” final rule (86 Fed. Reg. 2987, Jan. 14, 2021). CMS said it is seeking comment on the proposed repeal and its plan to “conduct future rulemaking to explore an expedited coverage pathway for innovative technologies (balanced with evidence development to ensure beneficial health outcomes for beneficiaries) and a regulatory definition of the Reasonable and Necessary standard for Medicare coverage.” AdvaMed, the global trade association representing medical technology manufacturers, issued a statement calling the move the “wrong decision for countless Medicare patients” and “the wrong decision for American medical innovation.”

Although the Medicare Part D program’s low-income subsidy is designed to ensure all beneficiaries have access to drug coverage, the Medicare Payment Advisory Commission (MedPAC) is concerned that the LIS in its current format has the potential to limit competition among benchmark plans and result in higher Medicare spending. As policymakers seek ways to preserve the Medicare Trust Fund while expanding Medicare benefits, LIS reforms could save the program money, MedPAC suggested at its most recent public meeting.

The LIS subsidizes premiums for nearly 13 million Medicare Part D beneficiaries, or 27% of overall Part D enrollees. Spending for LIS premiums in 2019, the most recent year available, totaled $3.8 billion, according to a Sept. 2 presentation by MedPAC Principal Policy Analyst Eric Rollins.